"Petroleum products, electricity and real estate should be brought under the GST for reasons limited to the GST. But if rising fuel prices become another reason for them (petroleum products) to be brought under it, then that's good," Subramanian told reporters.

Petrol and diesel prices rose last week to a three-year high across metro cities. Petrol prices in the national capital were at Rs 72.49 per litre -- the highest in over three years. Petrol prices in Kolkata, Mumbai and Chennai were at Rs 75.19, Rs 80.39 and Rs 75.18 per litre respectively -- all three-year highs. Similarly, diesel prices have also been hitting record levels.

During a press conference after Finance Minister Arun Jaitley tabled India's Economic Survey for 2017-18 in parliament, the Chief Economic Advisor also made a case for one GST rate for all goods and services.

"Over some horizon - say three to five years - we can think, in principle, of having one rate because we see that benefits of that are so compelling.

"But in the short run also, there is a case for greater simplification and greater rationalisation. At the moment we have five, six or seven rates. I think there is a scope for much greater rationalisation," Subramanian said.

"Let's not make the best the enemy of the good. I think we can get from a very complex to a less complex one," he said.